The real interest rate rises:
a. When society, as a whole, is less willing to give up consumption today for consumption in the future.
b. When society, as a whole, is more willing to give up consumption today for consumption in the future.
c. When expected inflation rises. It has nothing to do with whether or not a society is more or less willing to give up consumption today for tomorrow.
d. When expected inflation falls. It has nothing to do with whether a society is more or less willing to give up consumption today for tomorrow.
.A
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Monetarists believe that to promote long-term economic growth, national governments should:
a. Increase government spending and reduce taxes. b. Reduce government spending and increase taxes. c. Promote research and development with federal funds. d. Impose tariffs and quotas until the nation is on its feet. e. Create stable and predictable political environments and encourage competitive markets.
The inflation rate is calculated
a. by determining the change in the price index from the preceding period. b. by adding up the price increases of all goods and services. c. by computing a simple average of the price increases for all goods and services. d. by determining the percentage increase in the price index from the preceding period.